In Michigan, does Beverly Anns Cookie have a right of first refusal to purchase the assets of a franchise?
Beverly_Anns_Cookie Franchise · 2025 FDDAnswer from 2025 FDD Document
- (g) A provision which permits us to refuse to permit a transfer of ownership of a Franchise, except for good cause.
This subdivision does not prevent us from exercising a right of first refusal to purchase the Franchise.
Good cause shall include, but is not limited to:
(i) the failure of the proposed transferee to meet our then-current reasonable qualifications or standards.
(ii) the fact that the proposed transferee is a competitor of us or our subfranchisor.
(iii) the unwillingness of the proposed transferee to agree in writing to comply with all lawful obligations.
(iv) your or proposed transferee's failure to pay any sums owing to us or to cure any default in the Franchise Agreement existing at the time of the proposed transfer.
(h) A provision that requires you to resell to us items that are not uniquely identified with us.
This subdivision does not prohibit a provision that grants to us a right of first refusal to purchase the assets of a Franchise on the same terms and conditions as a bona fide third party willing and able to purchase those assets, nor does this subdivision prohibit a provision that grants us the right to acquire the assets of a Franchise for the market or appraised value of such assets if you have breached the lawful provisions of the Franchise Agreement and have failed to cure the breach in the manner provided in subdivision (c).
Source: Item 23 — RECEIPTS (FDD pages 57–235)
What This Means (2025 FDD)
According to Beverly Anns Cookie's 2025 Franchise Disclosure Document, the franchise agreement does not prevent Beverly Anns Cookie from exercising a right of first refusal to purchase a franchise in Michigan. This means that if a franchisee in Michigan decides to sell their franchise assets to a third party, Beverly Anns Cookie has the first opportunity to purchase those assets by matching the terms and conditions offered by the third party.
This right of first refusal does not require Beverly Anns Cookie to allow a transfer of ownership of a franchise, except for good cause. Good cause includes the proposed transferee's failure to meet Beverly Ann's Cookie's qualifications, being a competitor, unwillingness to comply with obligations, or failure to pay sums owed.
Additionally, the franchise agreement does not prohibit Beverly Anns Cookie from having the right to acquire the assets of a franchise for their market or appraised value if the franchisee has breached the franchise agreement and failed to cure the breach. This provides Beverly Anns Cookie with additional options for acquiring a franchise in Michigan under certain circumstances.